By Ken Weinberg
Carrier Logistics Inc.
This Opinion piece appears in the July 1 print edition of Transport Topics. Click here to subscribe today.
We’ve all suffered through computer downtime, usually at the worst possible moment. That was certainly the case with a number of freight carriers that experienced it during the hurricane that intensified to become Superstorm Sandy. Others were affected as a result of the 9/11 terrorist attacks. For many, the culprit has been a less traumatic but still disruptive event, such as an unexpected disk failure or file system corruption.
Some may not fully appreciate the high costs they pay for downtime. To understand the effects of system outages, do a complete inventory of all the cost areas that outages affect in your company and then, even more important, do the math. The calculations are so simple, they are almost intuitive.
First, estimate the revenue dollars that come in each hour and multiply by the hours of the outage. Then, enumerate all the employees the outage affected. Multiply their hourly pay and benefits cost by the hours of outage. The resulting number will be formidable.
Similar calculations will reveal the cost of lost productivity by the information technology (IT) staff who must fix the problem, lost customer service and credibility, overtime payments, wasted goods and financial penalties or fines. The result will be the realization that you undoubtedly lost thousands, perhaps tens or even hundreds of thousands of dollars and an untold cost in your service reputation.
Computers, which once were back-office tools for accounting, billing and pricing, now are used for customer-facing tasks, including rating, tracing and customer notifications of shipment arrivals.
And the trucking business has changed in basic ways — it is now 24/7, and customers demand instantaneous service on rate quotes and locating shipments. To keep things on schedule, companies need to operate and make decisions in real time.
You would think that, given the evidence of the critical need for technology and the potential lost revenue and productivity, lost shipments and a general breakdown of operations that can come from downtime, all trucking company owners and managers would take the time and make the investment in downtime prevention. But often because of fear of expense and just plain procrastination, many still persist in taking a “wait and see” attitude, figuring, “It will not happen to me,” or, if it did, “It will not happen again.”
Well, the time has passed for excuses and postponing the critical step to prevent computer downtime is over. Advances in technology and the development of cloud computing — the use of computer hardware and software available in a remote location and accessible over the Internet or another network — have driven the cost of preventing downtime way, way down. In spite of extreme damage, you can continue operating your business by backing up your data and communications links to keep them available when needed.
When computers go downtime-free, we call it “high availability,” and they operate by redundancy. All your data and communications links are duplicated in a remote location or in the cloud. You may choose to back up everything or just the portion of your data identified as critical. If your computer goes down, you can switch over to access all of your data, and all the networking for communications, in the redundant location — immediately and seamlessly.
Once you have “high availability,” there are several steps to implementing it.
• List the critical functions of your freight-carrying operation that will be on the “high availability” list, including quoting rates to customers, billing, tracing shipments and communications and shipping document interchange between drivers, terminals and the central computer system. Noncritical functions can be omitted from the high availability list, but make sure all parties know which functions are on and off the list.
• Test high availability with an exercise like a fire drill to make sure everyone knows what to do in case of any emergency or system crash.
• Develop a disaster-recovery plan to switch over to the data stored remotely, both from within the office and remotely from outside the office. The plan also should include recovery strategies for computer hardware and software, data files and databases, communications links, customer services, user operations and management information systems — all with the proper sign-ons, authorizations and notifications.
“High availability” is innovative, and few companies are using it so far. But two companies that are using it saw big benefits recently. One transportation and logistics company had a file system corruption failure and a resulting loss of data. With high availability, the carrier had all the data at another location and quickly made the “connection” to get running again.
Another trucking company had a similar problem because of a disk failure. But this company, too, had high availability, allowing the less-than-truckload carrier to be up and running again quickly — with no downtime observable by shippers.
Trucking companies in danger of experiencing computer downtime — and that means every trucking company — and lacking high availability need to discuss with their computer supplier and their own IT department how to institute high availability and maintain continuous service to customers. The price today is surprisingly low — and the risk of not having it is high and still rising.
You wouldn’t drive your car without having automobile insurance. High availability courtesy of cloud computing is, in effect, a necessary insurance policy for your business, and its cost is much lower than the cost of not having high availability.
If you aren’t sure, just do the math.
The author is co-founder of Carrier Logistics Inc., Tarrytown, N.Y., a provider of information technology systems to freight carriers.